Medicare legislation draws positive reactions

The workers' comp community is pleased overall with legislation that aims to streamline the Medicare secondary payer reporting process. However, one legal expert says it probably won't make that much of a difference for the system and may actually hurt taxpayers.

H.R. 1063, the Strengthening Medicare and Repaying Taxpayers Act of 2011, was introduced by Reps. Tim Murphy, R-Pa., and Ron Kind, D-Wis. It would amend the application of Medicare secondary payer rules for certain claims, including workers' comp.

Among its provisions, the proposal would:

Set a process and time frames for the Centers for Medicare and Medicaid Services to respond to requests for statements of conditional payment reimbursement amounts or waive the right to collect.
Establish an annual threshold for settlements to ensure CMS does not spend more on collecting than it stands to recover.
Implement safe harbors for reporting requirements.
Relax the requirement to obtain Social Security numbers of beneficiaries.
Set a statute of limitations for CMS to file an action after a notice of settlement.

CWCI: Medical provider networks effective, but reforms raise questions (04/08/13)
WC systems increasingly eye treatment guidelines (12/10/12)
State considers treatment guidelines through rule change (12/10/12)
Executive Summit speakers weigh in on comp challenges, solutions (11/03/11)
CMS proposal could add layer of complexity to comp cases (08/02/12)

The legislation has drawn the support of insurance trade associations, such as the American Insurance Association, as well as the Strategic Services on Unemployment and Workers' Compensation.

"It helps with certainty, improves time frames, and makes reasonable modifications in administration," said Doug Holmes, UWC president. "I think the people that are affected by the various provisions recognize this is a good way to go to address them."

The legislation, for example, sets a time limit on Medicare to respond to a request for a statement of conditional payment reimbursement. If the time frames are not met, Medicare would lose its right to collect the reimbursement.

"It puts the burden on the agency rather than litigants," said Jim Pocius, a shareholder with Marshall, Dennehey, Warner, Coleman & Goggin, in Philadelphia.

"From a litigation standpoint, I like streamlining the process. However, as a taxpayer I don't like this too much," Pocius said. "If litigants aren't paying their bills, who will pay them? The obvious answer is the taxpayers."

Pocius pointed out that CMS cannot provide a final amount until the settlement is concluded. "In those situations where medical bills are processed late, the taxpayer would pick this up," he said. "Great for the litigant, not so good for the taxpayers."

The legislation would fix what Pocius described as a "Catch-22." Currently, there is no onus on the parties to provide the substantial data payers must report to CMS, but the agency can fine payers up to $1,000 per day for failing to provide complete information. "It's like saying you can get caught for speeding but we're not going to tell you what the speed limit is," Pocius said. "You have to know the limit to comply with the law." The legislation would impose safe harbors to prevent fines against payers that are making good-faith efforts to provide the information.

Workers' comp stakeholders are also pleased with a provision that sets a three-year limit for CMS to bring legal action. "This is something where, for many insurers and employers, they may not have records going back that far," Holmes said. "This puts a reasonable time frame on legal actions to be brought by the U.S."

The legislation was sent to two House committees for consideration.

Read more at the WorkersComp Forum homepage.

April 4, 2011

Newsletter Sign-up